LECTURES - College of Social Sciences and International Studies ...

Public Power and Private Power
Yet it remains the historical and jurisprudential fact that limited
liability and the entities which enjoy it are entirely creatures
of statute. They are not conceived of as public bodies because
what they do is regarded as by definition their own affair, and
courts of judicial review correspondingly take no interest in their
activities. But this approach overlooks two major realities, one
physical, one legal.
The physical reality is that there are corporations which now
carry out functions that until recently were the state's, and others
which deploy more power in their field of activity than the state
does. For the former, it is difficult to see how a function ceases to
be a public function simply because of a change in who carries it
out. After all, private functions are not regarded as becoming
public functions simply because it is the state which conducts
them. 25 The rights and obligations of a plumber who is called in
to fix the toilets in an office building will not differ depending on
whether the building is a government office or a corporate HQ;
whichever it is, she will be able to sue for her charges if she is
not paid, and no member of the public, however directly
affected, is going to have standing to question the necessity
for her visit. Why then is the same not true, mutatis mutandis, of
functions which have an incontestably public character?
Modern public law has come to recognise that it is the nature
and purpose of a power, not necessarily its source or its repository,
which determines whether or not its exercise is a public
function. 26
debate among the saints in heaven as to whether the act of baptism has
invested the penguins with immortal souls or is, as lawyers would say, ultra
vires, null and void. Janet McLean has drawn my attention to the contrast
between early north American jurisprudence, treating each company as a
"little commonwealth" with corresponding public obligations, and the abrupt
holding of the U.S. Supreme Court in Santa Clara v. S. Pacific Railroad 118 U.S.
394 (1886) that corporations were persons for all Fourteenth Amendment
purposes.
25 The Human Rights Act 1998 by section 6(5) excludes the private acts of public
authorities. For an argument that this need not exclude employment rights,
see G. Morris, "The Human Rights Act and the public /private divide in
employment law" (1998) 27 I.L.J. 293.
26 See Lord Woolf, "Droit public—English style" [1995] P.L. 57 at 63-64: "... it
should be the nature of the activity and not the nature of the body which
should be decisive . . . "; Krishna Iyer J. in Som Prakash v. Union of India AIR
(1981) S.C. 212 at 219: "The true test is functional. Not how the legal person is
born but why it is created." For a New Zealand perspective, see Janet
McLean, "Contracting in the corporatised and privatised environment";
(1996) 7 P.L.R. 223; Michael Taggart, "Public utilities and public law" in
Joseph, ed., Essays on the Constitution (1995). New Zealand has arguably led
the way both politically (in corporatising and privatising public enterprises)
and jurisprudentially (in developing an analysis of the consequences).
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